Are you a regular loser at intraday trading? Watch this

[sonofcablemonster]

Hey Chaps

First seerious post from me in a while. The below presentation is made by guy called Dennis Dick who is a well respected prop trader with Bright Trading out in the US. He trades US stocks however what he is talking about applies to all instruments.

If you are trying to trade intraday (Day trading) you need to be very aware that around 70% of the market is bots. They wait for sufficient retail traders to enter the market so they can run the price back on you and force you out (liquidate you).

He comes up with some good advice:

(i) don't compete with them - you cant
(ii) consider lengthening time frames

Hope it helps you in your journey to be a CPT.

GTTY

 

[sonofcablemonster]

don't even need to watch link as what you say is complete rubbish


nobody has the clout to 'run' any market against liquidity of any size and it would be potential financial suicide to do so even if they did


im sure wrong way traders get their capital mopped up as a matter of course by the normal order flow but there aint no organized botsphere out there waiting to get you

I respect a lot of the guys at Bright and Dennis is one of them, they know their stuff. I guess that's why Goldman extend them so much buying power because they are charlatans who don't know what they are doing. If you don't think HFT trading can move a market and trap traders using techniques like 'momentum ignition' then that's fine. My days of arguing with people on anonymous publice message boards are over so good luck whatever you are trading. There are so many better things to be doing.

:cheesy:

 

[neil]

check out bias Kahneman style just cos theyre good in one area you think it applies to all areas


im not arguing with you nor expect you to argue back in turn just pointing out hat your parading as a fact is a fallacy and promotes a continuance of erroneous thinking which does nothing positve for aspirong traders


you want to carry on thinking your stuff thats your biz dude


an if you really had better things to be doing you wouldn be posting here so dont try and blow smoke bro

Cuts both ways bro. :whistling

 

[sonofcablemonster]

don't even need to watch link as what you say is complete rubbish


nobody has the clout to 'run' any market against liquidity of any size and it would be potential financial suicide to do so even if they did


im sure wrong way traders get their capital mopped up as a matter of course by the normal order flow but there aint no organized botsphere out there waiting to get you

right so I posted up a presentation and you are dismissing it as rubbish even though you say you haven't watched it.

I said 'you need to be very aware that around 70% of the market is bots'

is that what you think is rubbish?

I said 'They wait for sufficient retail traders to enter the market so they can run the price back on you and force you out (liquidate you)'

Is that what you think is rubbish? I would clarify I didn't mean this is the only thing the bots do it is one of the behaviours.

I would be interested to hear your side of the discussion if you are serious but if you haven't even watched the presentation it's a bit like us discussing a film that you haven't watched.

Good Luck.

 

[sonofcablemonster]

i was aware of that when i posted but im not the one sayin i got more important stuff than this to do am i?

just to clarify I didn't say I have better things to do than post. I said I had better things to do than argue with people on an anonymous internet forum. If people are intelligent then I certainly have time for logical discussion. Happy to discuss but if you want to argue without even watching the presentation then I am not up for that sorry.

 

[DionysusToast]

right so I posted up a presentation and you are dismissing it as rubbish even though you say you haven't watched it.

I said 'you need to be very aware that around 70% of the market is bots'

is that what you think is rubbish?

I said 'They wait for sufficient retail traders to enter the market so they can run the price back on you and force you out (liquidate you)'

Is that what you think is rubbish? I would clarify I didn't mean this is the only thing the bots do it is one of the behaviours.

I would be interested to hear your side of the discussion if you are serious but if you haven't even watched the presentation it's a bit like us discussing a film that you haven't watched.

Good Luck.

Did you actually watch the video? I think you jumped to a few conclusions about what the guy is saying. Certainly based on your description of what he says.

There'a a few things to consider.

This 70% number comes from somewhere - but I never actually saw it backed up - but anyway it's worth considering the fact that you are effectively saying that 70% of the market is targeting retail traders - or non-algorithmic traders many of which could be spreaders who don't care about direction anyway.

Whilst I heard that 70% of the market is algorithmic, I never heard it was 70% HFT. I think there is a huge difference.

Putting that aside - what is an algo? It's just a bit of code that executes a trade. An iceberg order to refresh bids as price trades a level is an algo. It's fairly dumb, not at all predatory and is just performing a task that would have been performed manually. Hell - a Ninja ATM strategy is an algo.

So - of your 70% algo's - what percentage of those are actually predatory? Can't be more predators than prey now, can there?

Next thing is the spread of algos. Stocks like BAC have traditionally been the target of Algo trading. 101 milions shares trade BAC on average, yet it's only moving 20-30c per day. At it's peak "C" would trade a billion shares a day and move 5c. It does seem that this has eased off now but you can see how executing a billion transactions on one stock can 'skew' any percentages you look at.

Anyway - suffice to say that not all algos are predatory and not this 70% is not evenly distributed across all markets. Not all trading is directional either so just because you see buying, does not mean people are getting long.

So - whilst running stops is not outside the realms of possibility - it certainly does happen, you need specific market conditions to allow it. No-one can simply turn a market around to run stops - they'd just get hit themselves if momentum was strong - in stock markets it's probably easier/cheaper to do this BUT you'd have to pick the right stocks - with fewer players.

Obviously markets get manipulated and that has been happening for years - way before algos existed and it's silly to think they don't but I think a little perspective is needed.

 

[sonofcablemonster]

Did you actually watch the video? I think you jumped to a few conclusions about what the guy is saying. Certainly based on your description of what he says.

There'a a few things to consider.

This 70% number comes from somewhere - but I never actually saw it backed up - but anyway it's worth considering the fact that you are effectively saying that 70% of the market is targeting retail traders - or non-algorithmic traders many of which could be spreaders who don't care about direction anyway.

Whilst I heard that 70% of the market is algorithmic, I never heard it was 70% HFT. I think there is a huge difference.

Putting that aside - what is an algo? It's just a bit of code that executes a trade. An iceberg order to refresh bids as price trades a level is an algo. It's fairly dumb, not at all predatory and is just performing a task that would have been performed manually. Hell - a Ninja ATM strategy is an algo.

So - of your 70% algo's - what percentage of those are actually predatory? Can't be more predators than prey now, can there?

Next thing is the spread of algos. Stocks like BAC have traditionally been the target of Algo trading. 101 milions shares trade BAC on average, yet it's only moving 20-30c per day. At it's peak "C" would trade a billion shares a day and move 5c. It does seem that this has eased off now but you can see how executing a billion transactions on one stock can 'skew' any percentages you look at.

Anyway - suffice to say that not all algos are predatory and not this 70% is not evenly distributed across all markets. Not all trading is directional either so just because you see buying, does not mean people are getting long.

So - whilst running stops is not outside the realms of possibility - it certainly does happen, you need specific market conditions to allow it. No-one can simply turn a market around to run stops - they'd just get hit themselves if momentum was strong - in stock markets it's probably easier/cheaper to do this BUT you'd have to pick the right stocks - with fewer players.

Obviously markets get manipulated and that has been happening for years - way before algos existed and it's silly to think they don't but I think a little perspective is needed.

Hi Peter. Hope life is good in Thailand. I didn't mean to imply that 70% of trading was predatory. The predatory portion is a subset of the 70%. I know all about the games in BAC I used to trade it at a prop firm back in 2012. More than 50% of my 2014 volume has been spreading eurex products so I take your point about spreaders and generally they do the most volume at prop firms especially the fly and condor guys. It does depend on the market. Take STIRS for example where the hft firm RSJ dominate the market, they simply iceberg the bid and ask and then chase the locals out. Many of my friends have had to switch market or change timeframes due to this.

often this manipulation is subtle. If you watch markets in the quiet lunchtime period you will see momentum ignition algos trying to trick other algos and manual traders into take a trade only for them to run it back on them.

Good luck

 

[Splitlink]

that was a cool post DionysusToast and your spot on with your observations which are exactly where im comin from


only one thing i don't agree with is that you can have more predators than prey and when that occur you get a natural reuction in the former until the latter flourish once more


this is excatly what been happening the last six years as algo and hft houses been goin out of business or booking losses or much reduced profits at best and they just waiting for normal market conditions to return away from all the cb and gov soft and hard intervention


I guess sumo boy need more time at the screen and less time in the chow hall

There is a difference between DT and you. He makes good argument that can be read and appreciated.

You are rude. A big difference when trying to get a message across.

Something that did register with me, watching the video,was the advice that it may be better to leave the smaller TFs alone. I think that most people lose money (apart from, simply, not knowing enough about the subject) because they do not want to risk a lot on the trade. The easiest answer to that, if one wants to trade with bars, is to use a 5 minute TF. The predators know that and operate on that principle. The bigger the TF, the deeper pockets one must have for the risk management, but it makes more reliable progress and fewer trades in a day.

Yesterday, I did two trades and am, still, on trade 1 for today.

 

[DionysusToast]

that was a cool post DionysusToast and your spot on with your observations which are exactly where im comin from


only one thing i don't agree with is that you can have more predators than prey and when that occur you get a natural reuction in the former until the latter flourish once more


this is excatly what been happening the last six years as algo and hft houses been goin out of business or booking losses or much reduced profits at best and they just waiting for normal market conditions to return away from all the cb and gov soft and hard intervention


I guess sumo boy need more time at the screen and less time in the chow hall

Actually - I agree with what you say about predators and prey and that's why I don't worry about HFTs. I think a lot of them will die as it becomes more competitive.

I think there is a tendency for traders to externalize their losses. It is possible to make money short term trading and if someone is losing, I don't think HFTs are to blame.

 

[Splitlink]

what you untereprt as rude is your bag dude im just direct and breif


but that aside ill trade polite and wrong for rude and right any day


if my tone was terse with sumo boy its cos i dislike bull-slitters using pumped up market clout asa proxy for personal importance to sell an idea when both the idea and the premise are so completely incorrect


regardless of your views which dont bother me none i disagree with your view on the trading period being systemtically relevent in any scenario involving spoffing and manipulation as th eprice is the price is th eprice and it takes a smuch muscle to move it 1 pip or 1 point or 1 cent independent of any trading period which is justa subjective overlay on the relatiy of the undelrying asset it monitors

I take on board what you say. You go ahead being rude and right if you believe that that is what it takes.Personally, though, I have no evidence of that.

 

[Splitlink]

apparently you do for the first bit


its ok splitlink i appreciate you didn't get along too well with my pop and he warnedme thered be a few here that would give ma ahard time cos of him

 

[Sonicscooter]

apparently you do for the first bit


its ok splitlink i appreciate you didn't get along too well with my pop and he warnedme thered be a few here that would give ma ahard time cos of him

I'll cut it straight to the chase, your bad mannered, your typing is Sh1te, so as we say in Old Blighty, "Do one".

 

[Sonicscooter]

wouldnt normally bother but as youve taken the trouble to blow off its "you're bad mannered" not "your bad mannered"


if punctuation and grammar and spelling are your thing then at least get yours right when you take someone else to task for it


no idea what "Do one" might mean and incredibly disinterested in finding out but i assume its what all you limey guys do when your wives go out

Wouldn't know, not married, so you can spell, so your education wasn't completely wasted.

Regards.....

 

[robster970]

This thread is worth reading just for the put-downs from ballard...timeless classics, well executed.

 

[sonofcablemonster]

This thread is worth reading just for the put-downs from ballard...timeless classics, well executed.

yeah you got me. a couple did tickle me especially when it got personal.